E Market Briefing For Friday, Jan. 19

An energetic overreach has many stocks and sectors ahead of analyst maximum targets for 2018; just as happened much earlier in 2017 as well. The intraday jitters are irresolute, as for the moment they're swinging on all the shifting prospects about a Government shutdown this weekend. 

Absolutely the impact of the tax reform (and capital repatriation); plus very constructive corporate moves such as Apple's; give the impression that skeptic assumptions that companies will solely use added funds for 'buybacks' (a dreaded form of reducing floating supply but for executive compensation in an indirect fashion) ...well..those assumptions were (thankfully) overblown.

Nevertheless, even with Apple raising the bar higher (with respect to how companies make decisions) very clearly, others are doing their share with bonuses and not merely buybacks. There seems to be a trend-in-motion to 'do the right thing' with respect to what the goals of these policies primarily are: growing America's economy; allowing our global leadership to persist; and aiding incomes for the Middle Class.

As the markets understood the basic importance of these policies we have believed essential for more than a year, buyers have capitulated and bears are rarely seen. That's pushed many even further to the long side of the ledger; and seasonal fund flows assist that a little (and may into Spring).

At the same time the market is increasingly keenly aware this is stretched. That's why I say it's been energetic; it's eclipsed targets; it can go higher in the fullness of time; but it is also long-in-the-tooth short-run. Hence lower thresholds to shakeout the market, periodically; but it won't stick as of yet. 

At least IBM broke its long losing streak and surpassed expectations. It's the first time revenues grew in 23 quarters; and affirms several points I've made, regarding not just its role in 'blockchain' technology; but their shift in focus to 'annuity-style' incomes (service rather than just one time sales) of software or hardware; and their increasing alliance with Apple for business Apps, which points Apple as well, more in a business direction.

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